DPSI - Earnings call transcript Q2 2022 | DecisionPoint Systems, Inc.

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Operator

Good day, and welcome to the Decision Point Systems, Inc.

Second Quarter 2022 Earnings Call and Webcast. Today's conference call is being recorded. At this time, I'd like to turn the conference over to Brian Siegel. Please go ahead, sir.

Brian Siegel

to Second welcome Call. XXXX and afternoon, DecisionPoint Quarter Systems Earnings Good

me Chief of Vice Smith, are Finance. Officer; Joining Steve Wohl, Executive today and Melinda President

For website at today's not on those Investors www.decisionpt.com. that is the our it available seen of section of you release, have

the are statements like I information, place. these that or mean best risks uncertainties. like will Words involve events expect of but for would this and this that actually in beginning, results anticipated be that remind everyone several discussed Before except estimates as there presentation take believe, or anticipate expected that no our to historical matters are forward-looking writing, that assurances and can

other we non-GAAP results non-GAAP differ statements. actual EPS will GAAP and from EPS gains quarterly and the company's and transaction with over future now non-GAAP our on compensation, is So and income in contained extinguishing turn measures, that, M&A our costs factors EBITDA. for With measures net adjust annual Steve. information the nonoperating company's reports could stock-based SEC. the financial including any other income expense to the These filed this net non-GAAP income, Further risk financial significantly I'll debt, those and and items. discuss adjusted U.S. call nonrecurring call, Also, during on

Steve Smith

us to for results quarter, Thank very say second everyone, continue reporting you, record afternoon, Brian. during we today. strength significant see today. I am joining in good again thank you and to that our once the And excited business

discuss discussing second then who then enterprise financial opportunity. market results. solutions and is Systems, mobility-first services results, briefly I'm strategy expand to and will going this However, DecisionPoint our turn to start opportunity review to before call growth company. our to these DecisionPoint Melinda over and our I by capture the a it quarter is I and our discuss

emerging of at secular mobility, which to managed SaaS, exactly? and IoT. what encompasses means So services, trends, aim home center and work does that enterprise It the and cloud, we from several XG be that mean mobility, including field

industries Now us where the TAM have, hospitality several we of billions to and health these solutions, develop therefore, and to become these we of already industries the handful can significant after. markets represent identified acquire expertise retail, established hundreds we technology or and are ability customers, a or of either Currently, go have players. underpenetrated where logistics, right for subsegments care, partners under industry-specific so

the Our better, us inside We scanners, like is decisions to to value drive accurate and outcomes. such business create better VAR employees operational effectiveness efficiency handheld frontline of business other and point-of-sale printers, and or clear. mobile four enable outside customers classified as companies proposition value-added devices experiences resellers and Traditionally, walls more as make fast been devices. and customer have to

HP, include introducing With Ingram. also those business partners VeriFone, run Honeywell, historically grown X%. Cradlepoint orders has to BlueStar, to at OEM rate Zebra, and This times. numbers a lumpiness about Our X% Datalogic, distributors, of incremental some but Apple, ScanSource being project and at

consumables replenishing devices. business, for have annuity-type also We these excellent an

to status help the area and functions, visibility designing, designed complexity strategy. to monitoring a landscape. investment on for improve IT generate provisioning, where high-margin by of model a mobile services include said, increase inorganically So organically companies services the growth think ones transformed past That various razor revenue. and simplify over the managed these as include deploying our device desk the We product key certain outsource solution. offer and especially of rates it services, both and company reoccurring of the market of portfolio blade comprehensive services-led and margins managing razor to and Managed the These moving years, we've services three services their significantly up our to that here. managed aggressively

In managed and software we software customer-specific support. services, staging, installation, customization and including consulting, addition maintenance and repair hardware offer to services, professional deployment

building are SaaS as for or our helps and manager on revenue DSD an the and direct We industry implementation. route MobileConductor opportunistically ViziTrace packaged store higher-margin software solutions today reoccurring also which custom-developed in such includes portfolio, both delivery RFID which and manage

Moving strategy. four growth pillar to our

and share The warehouse, supply current first health in and is chain, to verticals, increase specifically care, grocery our specialty retail, distribution transportation.

logistics. to include The in experience hospitality big Examples supply would second pillar adjacencies. our here leverage and box into these retail verticals is chain

and is expansion, pillar software where and expansion customers services. services, pick and And by partners coverage. fourth field we expand increase can professional third service managed from sales up to and and repair and rates. increasing margin pillar include The our drive These SaaS software new attach maintenance the ISV growth services, geographic services, is

strategy and make remain Our more acquisitions four respect achieve to make are in to to field to just active growth. to pillars, going this scale. our M&A we these complement to we not to achieve -- supports expect we're going With M&A, organic acquisitions

and strategy system. areas, us by have costs, their through companies we These a record integration-ready nationwide revenue of to that SG&A and drive on we revenue and offerings operations, fit of operations requirements specific streamline target. focusing By a developed move expanding have quickly these We include compatibility. reduce and cultural synergies our a allows to positive EBITDA, and successful growth track solutions integration

have and look point progressively acquiring the this quarter, year to in we the integrated targets are half of we potential and second In at the fact, where for those ready quickly two after XXXX. first companies in to

orders QX, two of quarter and the during completely expecting we're were driven again quarterly in filled highlights. filled large moving was that to the not revenue in record be project second our growing to had Note these million. in orders half $XX quarter. We XX% came to mostly Now strength that second once by This 'XX.

revenue particularly recall of whopping $X.X welcome, million. half targets was EBITDA exceeded the goodness million Adjusted that services $X.X the our million in to our year, full to XXX% this While we $X.X the $X.X million. XX% growing previous of of increased internal EBITDA during our year adjusted guidance I'm may means first versus quarter, This excited $X the a to you reported in quarter. million

that our also M&A saw continued We is working. strategy evidence

sales In continue active during customers grow to quarter. existing campaigns the in fact, the with progress our deals teams cross-selling and the

As well closing, want Please had beginning note, the acquisitions of on a of our make million during just we next And as million $XX the growth. first half in we provided. the from currently these our of XX% within $X we expect the positioned services. to those great numbers that presenting million we expect would to now for million to their perspective, do an year, deliver I also not to million week mix, the and work. of include one-on-ones. half year. just we that we I and ranges that $XX terms would look From strategy. is trajectory. hard expect and will come continued revenue growth any thank continue I $XX employees revenue In are second approximately to the or EBITDA adjusted continue And SidotiMicroCap between year. potential $X.X be to between dedicated the we execute for We Conference approximately growth of that to available this I we at XX% our And remainder expect generate in finally, may

to So through our Brian to request or with forward portal you're the reach Siegel. Sidoti either out I conference in you quarter call. if interested a look again a Otherwise, second please speaking submit meeting, on

Now our it over review more turn in to I to will detail. Melinda results financial

Melinda Wohl

$XX we to follows: second saw continued Thank Details in performance quarter were million. demand you, operating as XX% total compared Steve. to quarter XXXX of QX with our up second strong revenue

M&A, our growth Excluding was rate revenue XX%. still very impressive gross at

retail During which we the historical is quarter it impacting we norms. still QX, million combined with through million, was combination we in chain orders the received than companies. quarter, of due our last to global and to $XX about Xx issues portion backlog a Backlog worked higher built $XX the supply many a normal that of are from our two

our our to distributors have been times, clients access OEMs to in to orders and partnerships to are with and lead As longer build putting products inventory. and a leverage gain strong with we ship fortunately able result,

the GAAP to hardware on gross to led growth XX% we fulfilled, lower which prior We Product an was Moving due orders slightly increase the rate from unplanned heavy a year. profit. the side to saw This mix increase when marketing. operating sales about by first result was revenue. quarter. expenses increased million, compared to G&A the mainly and and $X acquisitions a of in split between the evenly made we

EPS and expenses non-GAAP repeat $XXX,XXX.XX net M&A-related year. we compensation $XX,XXX excluded operating improve last approximately net extinguishment last income $XXX,XXX income income forward we gain compared year. of synergies As EPS $X.X leverage. the $XXX,XXX.XX of $XXX,XXX the year. were expect of versus benefits year the of compared and million with versus this stock-based EBITDA net year, and last million GAAP this million and to that and year last diluted $XXX,XXX year did were our move EPS to to non-GAAP $X.X $XXX,XXX.XX not last numbers cost diluted our The $X.X was on the debt realize Adjusted following: integration

our XX, quarter with We $X.X Turning and sheet. XXXX. cash million balance to ended at cash the million December $X.X versus equivalents totaling

Net borrowings year-end, receive had Total earlier, the As to orders line of about million increased cash on by in the to activities million revenue. quarter year. of lead increase end a $X.X continue flat times was $X provided last million mentioned to credit. to with at we I our from long we debt leading deferred no $XXX,XXX, operating $XX.X and

strong and the that, believe see for is can had move So questions. we you to we can a business of year, XXXX. our the we continued of And currently positioned with growth for operator, remainder start very

Operator

we'll today take Brothers. question John from Taglich Nobile And Instructions] [Operator first with our

John Nobile

quarter numbers. press could that I'd half the But I'm in to much of just XXXX? second the to you in you I out new quarter expect see about orders recently that second quarter was what that. or Congratulations current some put quarter? And break it third know, the you also release this recognized do was it very Melinda. and It's the Steven, second recognized afternoon, reported. actually, hoping a Good strong of on like $XX that of to nice down you sorry. is how recognize was in in million

Steve Smith

you Melinda that, please? why handle don't

Melinda Wohl

-- that about We recognize go sorry, it. out and in spoke have $XX about QX. about that QX million -- of of we I'm QX of to still John, $X in million set to

John Nobile

Okay.

So most second already the that quarter of in then? was recognized

Melinda Wohl

About million to $X $X $X million, John. million.

John Nobile

sorry. I'm Okay.

to to going not $XX more the So be from this? is XXXX, obviously, because in guess, recognized going there's be I XXXX recognized, fully million into

Melinda Wohl

or know You was of specific the one customer. XXXX not sub orders revenues what, to

So of already was some was it already it recognized. --

John Nobile

combination a that sales related to Or that both your that hardware -- is segments? is that on And going to hardware million amount, be strictly business? Okay. the or of staying of $XX be to going segment the service and is

Melinda Wohl

roll the We -- some related still that services out have to to to orders. million $XX

John Nobile

Okay.

growth XX%. Because the actually still which million, $XX I to guidance saw Okay. robust was there pretty service equates being about for

So talk hoping you your of is little services in guidance And previous with that new investments I just before question. one was in offerings. still million this final in. orders came $XX range your guidance the about could a

Now and or services drive -- going appreciate and only how you plan you If not that, you to I'd SaaS just light on forward? but subscription add what that, some revenue could that, it. call

Steve Smith

three John. here. that, ways Yes, take I'll Melinda. to there's Really, Thanks, grow

through organically, all X. through We've can grow partnerships You done could can acquisitions. you and you grow grow

on. we sales to are portfolio on that services continue force we train focusing So the our driving and ever-expanding of

our third, Secondly, looking almost partnerships services to of you through targets and that the of will, we grown partnerships, services look leverage to able that we're those continue add and will for key label, to our portfolio. build-out then through has but in represent portfolio services, white if are also market. And grown it's and we'll organic acquisition

almost my as hardware In been done those Where are with traditional the attached XXX% at to look have priority revenues that some their four is from our the in really that "hardware" services to we've more past, services. where acquisitions, companies fact, sales. based of reseller

successfully because we strategy and come they've organizations, And operate orders, organizations. two to the on extension customers IT just looking think those and that we a that it's this not IT have. what retail exactly going trail. it's provided vacuum, expand, listen leveraged continue services developing we've we basically we it's the think are on we the they're and their strategy, is customers our us. our They've an to as expand we to and So their capabilities as are our delivered strategy to customers them are we virtually to in And as our continue leverage deliver large And asking to the money those follow portfolio, for. right services, when to right we our

John Nobile

significantly that your to this the from, product could do margin Okay. could if just didn't going on the in the which remainder call feel margin. higher million is And obviously, and do I right your faster forward. figure growth of sales, component business yet number is the growing service see service you where out in now, I provide most crunching but year the assuming than year product $XX you this sales, is

Steve Smith

accounted which don't project a mid-teens on year-over-year. categorize business You hardware, the our growth that growing orders percentage virtue And just the I margin but at do as anomaly good there, in would and higher and seen three that some the company services. ability of hardware have focus is the year-over-year, XX% services business and to By the services-based. we've large of mean grow It's be we've of for you QX at I next growth drive getting XX% of where categorized focus the more. We're alluded or our growing. is, math, to five year-over-year right? it with is to. that's over that the our that's the percentage And significant But to bullish years to to to performance day on maintain we XX% will we've see clear, continue realized. is

Operator

do Shrink question [Consulta.] Giordano the We have right. All queue another with from in

Unidentified Analyst

Smith and Melinda.

road you interested question. in quick Exchange. on down want the the options in stock if course, know Congratulations, the just one to Amex stock. on are are putting the Stock of to Just I uptick

Steve Smith

on now operating talked in and really time been or first we noted, haven't here. York you We've X. American know for in We the OTC from the lightspeed terms. February of We occurred at those We, Stock to Exchange uplisted uplisted the to that 'XX. there New May as

now option trading realizing position and with that at delighted activity have this we moment. we're the the right where we So stand that we're discussed any not

Unidentified Analyst

know trading numbers. the times at it think at That's I heavy. Okay. I if why the very look for stock you qualify is you

Steve Smith

decisions time Yes, of Relations make our comment with third through I would the appropriate. that company to We'll as options. list well It's those have as no Board. Certainly further type parties Investor be appropriate as the that is dealt thing it. when

to So like talk you'd have like to CBOE stuff and that.

Operator

Thank your you today's participation. and today's question-and-answer session conclude conference That will call. for

You may now disconnect.

DecisionPoint Systems (DPSIP) 13 Aug 222022 Q2 Earnings call transcript